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(Alliance News) - BHP Group Ltd on Tuesday reported a "strong" set of interim results, leading to the miner declaring a bumper payout.
Revenue from continuing operations for the six months to December 31 rose 27% to USD30.53 billion from USD24.04 billion a year earlier.
Pretax profit increased 61% to USD14.49 billion from USD9.01 billion.
This figures do not include BHP's petroleum assets, as those are soon to be transferred to Woodside Petroleum Ltd, in a deal announced in November 2021 and set to close in the June 2022 quarter.
Behind the increase in profit was higher sales prices across major commodities, near record production at Western Australia Iron Ore and higher concentrate sales at Spence. This was offset somewhat by inflationary pressures, including higher fuel and energy prices.
Released last month, BHP said copper production in the period 12% year-on-year to 742,000 tonnes while the metal's average realised price rose 30% to USD4.31 per pound. Iron ore production rose 0.8% to 129.4 million tonnes.
"BHP had a strong first half. We achieved our third consecutive fatality free calendar year. We mitigated the impacts of Covid-19 and significant adverse weather events to turn in a solid operational performance, particularly from our flagship Western Australian Iron Ore business," said Chief Executive Mike Henry.
The robust half led to the firm declaring a record interim dividend of USD1.50, up from USD1.01 a year before and beating forecasts of USD1.24. The payout was supported by a "reliable operating performance" and "continued strong markets".
"BHP is well positioned for the future. We are building on our strong foundations and capital discipline to reshape our business and grow long-term value for shareholders and other stakeholders," said Henry.
Looking ahead, BHP said it remains positive on commodity demand though did flag cost pressures. The firm cited labour costs and other industry-wide inflationary pressures, and said cost headwinds due to supply bottlenecks are set to remain challenging throughout the remainder of the current financial year. These pressures should see "only tentative signs of easing" by the end of the period.
"As the actual recognition of costs tends to lag developments in prompt pricing, these pressures
are expected to continue to impact on our cost base in the following calendar year. Demand-led inflation in the broader economy, reflecting a healthy tension between rising demand and the ability to meet it, is expected to endure for some time. That is fundamentally positive for the resources industry," BHP said.
By Lucy Heming; lucyheming@alliancenews.com
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